There Is Still A Long Way To Go Before The Cotton Market Ushering In The Spring.

In 2015/16, the world began to go to the inventory stage, but with little effort.

This year's global output of 22 million 580 thousand tons, down 3 million 353 thousand tons compared with the same period last year; global consumption of 24 million 252 thousand tons, an increase of 221 thousand tons compared with the same period last year; ending inventory of 22 million 729 thousand tons, down 1 million 658 thousand tons compared with the same period last year; inventories consumption was 93.72%, down 7.76 percentage points year-on-year.

In the case of high inventory and weak cotton prices, we expect that the trend of 2016/17 inventory will continue.

Domestically, in the year 2015/16, 5 million tons of output and 1 million 200 thousand tons of imports were added, and the new supply was about 6 million 200 thousand tons. In terms of demand, USDA is expected to be around 7 million tons, and the demand for this year is perhaps not so optimistic from the downstream consumption of new cotton.

We estimate that domestic cotton consumption per month is 50-55 million tons, and the annual consumption will be 600-660 tons.

Take median demand or around 6 million 300 thousand tons.

Inventory is a tight balance this year.

Specific to the cotton price trend, the same language.

We think of high rank.

It can make high count yarn, and the resources will be less and the price will remain strong, but the low grade cotton will have to be different.

This part of the low-grade cotton can only be used as a low count yarn, but the price is not competitive with the outer yarn, so it is expected that this part of the cotton price will go down.

Of course, there will not be a sharp decline in the short term. The price of the disk has been low. In accordance with the law of history, the price of cotton will rise slightly after the Spring Festival. So we expect that cotton prices will be stable in the beginning of 2016, and we will not rule out a slight rise.

In 3-4, the market is expected to throw away or to carry out, if

If the price is too high, it will probably be the same as in the first half of this year. The turnover is weak, and the effect of stock going is not good. But if we want to increase the intensity of stock going, the price will have an advantage over the market price. At that time, the low price will lead the low grade cotton to continue downward.

Looking forward to 2016/17, we believe that the domestic cotton market will be more optimistic than this year, and the reduction of production is a big probability event. Under the control of the domestic quota policy, the import volume is not expected to increase. All the supply will decline again. In the next year's demand, we believe that the import of the outer yarn will decrease and the price of viscose staple will be upside down. The two parts of the imported products will have a trend of growth in consumption.

Therefore, compared with the current year, the gap between supply and demand has increased, but once we consider the amount of stocks stored in the State Reserve, the gap is not worth mentioning.

Therefore, although the domestic cotton market will improve in the next year, there will still be a long way to go when the cotton market ushering in the spring.